E&P

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Definitions

Current Earnings and Profits E&P Taxable Income Accumulated Earnings and Profits Shareholder Distributions Corporate Taxation Dividend Income Accounting

In calculating a corporation's Current Earnings and Profits (E&P), nontaxable or tax-exempt income is added to the taxable income for the tax year. Current E&P, if not paid out, transitions into Accumulated E&P. Distributions are first taken from current E&P, and then from accumulated E&P. These distributions are taxable to shareholders to the extent of current and accumulated E&P.